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Asset's hard-hitting strategy of going after consumers in
small-claims courts has affected tens of thousands of people around
the country... When individuals fight back against the company in
court, consumer lawyers and advocates say, Asset often drops its
suits, not wishing to engage in expensive legal skirmishing."
WALL STREET JOURNAL / October 25, 2004
Once-Ignored Consumer Debts Are Focus of Booming Industry
Asset Acceptance, a New Type Of Collector, Hits Paydirt
Suing for Modest Sums
Some Fight Back -- and Win
In 1996, when Heather Scott's marriage split up, she defaulted on
$3,000 she owed on her Discover credit card. "It was either that or
feed my kids," the Phoenix woman says. Until recently, she probably
could have walked away from her credit-card debt with little more than
a damaged credit report. But an increasingly aggressive
debt-collection industry is going after people, like Ms. Scott, who
used to fly below the radar.
For six years, she heard nothing about her Discover debt. Then, in
2002, she was sued in small-claims court in Phoenix. A company called
Asset Acceptance Capital Corp. had bought her Discover debt and wanted
to collect. The 35-year-old single mother of two, who says she
couldn't afford a lawyer, didn't show up in court. Asset won a default
judgment of about $9,500, including more than $2,000 for the company's
legal fees. For the past year, the company has been taking about $100
out of the $625 paycheck she receives every two weeks as an
administrative worker for the state of Arizona.
Speaking generally, Asset makes no apology for pursuing people who
failed to pay their bills and says it treats them all fairly. The
company has now agreed to settle with Ms. Scott. She will pay an
additional $3,000, for a total of $6,111, or 36% less than the court
judgment.
Asset's hard-hitting strategy of going after consumers in small-claims
courts has affected tens of thousands of people around the country. In
the process, the company is helping reshape the burgeoning business of
profiting from bad consumer debt.
Most home and car lenders have never hesitated to chase debtors who
fall behind on payments. But many other consumer lenders, such as
credit-card issuers and businesses ranging from health clubs to
utilities, traditionally didn't tail debtors for more than a few
months. These companies have feared bad publicity and have wanted to
avoid the costs of pursuing what often are relatively small debts.
As the number of these debts grew, a new breed of collector sprouted,
eager to buy up consumer debt that creditors had given up on. Now, as
more Americans are juggling more debt than ever before, the newcomers
have grown into a multibillion-dollar industry that is scraping the
bottom of the barrel to go after debtors who previously would have
been left alone. Unlike old-fashioned collection agencies, which
pursue debtors on behalf of a client company and keep a set percentage
of what they gather, the newer debt-buying companies typically acquire
large portfolios of bad debt at a discount.
The king of the debt buyers is Asset Acceptance, based in Warren,
Mich. It scoops up the oldest, least-desirable debts that creditors
have already charged off as losses. Sometimes, Asset chases debtors
after as many as three previous collection firms have failed. Asset
and its rivals can make a profit because they keep costs low, paying
as little as two cents on the dollar for debt. Asset adds a legal
component to the strategy, employing an army of outside lawyers to
file thousands of small-claims suits each year. "These debts have
already been through an arduous process -- they've had the kitchen
sink thrown at them -- so we need to go beyond our predecessors to be
successful," says Asset's chairman, Rufus H. ("Bud") Reitzel.
Financially, Asset has been a huge success. It employs 1,600 people,
up from 37 in 1996. It owns 16 million accounts, including $4.2
billion in debt bought just last year. Revenue has grown an average of
57% a year since 1999, topping $160 million last year. The company's
operating earnings, which reflect a reorganization related to Asset's
initial public offering in March, grew on average by 58% a year, to
$54.8 million last year. A group led by Bear Stearns Cos. took Asset
public on the Nasdaq Stock Market at $17 a share. It closed Friday
afternoon at $18.90, down 24 cents.
Asset's rising fortunes reflect those of the booming debt-buying
industry, as growing numbers of creditors -- from credit-card issuers
to phone companies to hospitals and gyms -- turn to selling their bad
debts as a source of revenue. In 1993, $660 million of charged-off
credit-card debt was sold, according to the Nilson Report, a trade
publication. Last year, the number reached $57.3 billion.
In the past two years, three debt buyers -- Portfolio Recovery
Associates Inc., Asta Funding Inc. and Asset -- have issued shares to
the public for the first time. Encore Capital Group Inc., a debt buyer
in which Wall Street veteran Nelson Peltz has a major stake, moved
from over-the-counter trading to the more prestigious Nasdaq Stock
Market last year. Encore's shares have soared to $18.52 as of Friday,
compared with 30 cents in the beginning of 2002.
Asset and other debt buyers say they frequently offer to resolve debts
for far less than what they are owed, benefiting consumers. Asset
further asserts that by buying old debt, it indirectly encourages new
lending and the lowering of borrowing costs. "We are the good guys,"
Mr. Reitzel says.
His company's new collectors go through four weeks of training that
drills them in federal debt-collection laws, and executives say their
employees are so sincere that some debtors send collectors gifts and
cards for Christmas. Some attorneys who have represented consumers
against Asset say the outside lawyers the company hires are generally
professional in their dealings.
Small Claims
But there is more to the story. According to some lawyers and
advocates for consumers, Asset uses the relaxed rules of small-claims
and municipal courts to file suits that contain little documentation
of the debts it seeks to collect. These courts typically allow for
quick judgments when legally unsophisticated defendants fail to
contest the suits, the critics say. Once it obtains judgments, Asset
can use the full weight of the legal system to enforce its victories,
primarily by seizing assets or garnishing wages.
When individuals fight back against the company in court, consumer
lawyers and advocates say, Asset often drops its suits, not wishing to
engage in expensive legal skirmishing. The upshot is that poorer and
less sophisticated debtors are more likely to face a judgment for
Asset, these lawyers and advocates say.
Asset counters that it tries to collect from all of its debtors before
going to court. The company denies that its methods are harder on the
unsophisticated. It says that all of its legal actions are backed by
the "documentation necessary" and that it informs consumers quickly
when they have been sued.
"Frankly, a debtor is a debtor," the firm said in a written response
to questions. "If a person has the resources to pay their past
obligations, we will pursue the matter to the fullest extent."
Collections that include filing suit generate roughly a third of the
company's revenues and
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redit Card debt is a huge problem. There is a very successful
company,NASDAQ listed, around 2,000 employees, and revenues of around
$800 million per year.
Its a huge number. They are the guys who dunn you.AND COLLECT!
No more free pizza!
Joel
On 25 Oct 2004 08:52:55 -0700, MrPepper11@go.com (MrPepper11) wrote:
"Asset's hard-hitting strategy of going after consumers in
small-claims courts has affected tens of thousands of people around
the country... When individuals fight back against the company in
court, consumer lawyers and advocates say, Asset often drops its
suits, not wishing to engage in expensive legal skirmishing."
WALL STREET JOURNAL / October 25, 2004
Once-Ignored Consumer Debts Are Focus of Booming Industry
Asset Acceptance, a New Type Of Collector, Hits Paydirt
Suing for Modest Sums
Some Fight Back -- and Win
In 1996, when Heather Scott's marriage split up, she defaulted on
$3,000 she owed on her Discover credit card. "It was either that or
feed my kids," the Phoenix woman says. Until recently, she probably
could have walked away from her credit-card debt with little more than
a damaged credit report. But an increasingly aggressive
debt-collection industry is going after people, like Ms. Scott, who
used to fly below the radar.
For six years, she heard nothing about her Discover debt. Then, in
2002, she was sued in small-claims court in Phoenix. A company called
Asset Acceptance Capital Corp. had bought her Discover debt and wanted
to collect. The 35-year-old single mother of two, who says she
couldn't afford a lawyer, didn't show up in court. Asset won a default
judgment of about $9,500, including more than $2,000 for the company's
legal fees. For the past year, the company has been taking about $100
out of the $625 paycheck she receives every two weeks as an
administrative worker for the state of Arizona.
Speaking generally, Asset makes no apology for pursuing people who
failed to pay their bills and says it treats them all fairly. The
company has now agreed to settle with Ms. Scott. She will pay an
additional $3,000, for a total of $6,111, or 36% less than the court
judgment.
Asset's hard-hitting strategy of going after consumers in small-claims
courts has affected tens of thousands of people around the country. In
the process, the company is helping reshape the burgeoning business of
profiting from bad consumer debt.
Most home and car lenders have never hesitated to chase debtors who
fall behind on payments. But many other consumer lenders, such as
credit-card issuers and businesses ranging from health clubs to
utilities, traditionally didn't tail debtors for more than a few
months. These companies have feared bad publicity and have wanted to
avoid the costs of pursuing what often are relatively small debts.
As the number of these debts grew, a new breed of collector sprouted,
eager to buy up consumer debt that creditors had given up on. Now, as
more Americans are juggling more debt than ever before, the newcomers
have grown into a multibillion-dollar industry that is scraping the
bottom of the barrel to go after debtors who previously would have
been left alone. Unlike old-fashioned collection agencies, which
pursue debtors on behalf of a client company and keep a set percentage
of what they gather, the newer debt-buying companies typically acquire
large portfolios of bad debt at a discount.
The king of the debt buyers is Asset Acceptance, based in Warren,
Mich. It scoops up the oldest, least-desirable debts that creditors
have already charged off as losses. Sometimes, Asset chases debtors
after as many as three previous collection firms have failed. Asset
and its rivals can make a profit because they keep costs low, paying
as little as two cents on the dollar for debt. Asset adds a legal
component to the strategy, employing an army of outside lawyers to
file thousands of small-claims suits each year. "These debts have
already been through an arduous process -- they've had the kitchen
sink thrown at them -- so we need to go beyond our predecessors to be
successful," says Asset's chairman, Rufus H. ("Bud") Reitzel.
Financially, Asset has been a huge success. It employs 1,600 people,
up from 37 in 1996. It owns 16 million accounts, including $4.2
billion in debt bought just last year. Revenue has grown an average of
57% a year since 1999, topping $160 million last year. The company's
operating earnings, which reflect a reorganization related to Asset's
initial public offering in March, grew on average by 58% a year, to
$54.8 million last year. A group led by Bear Stearns Cos. took Asset
public on the Nasdaq Stock Market at $17 a share. It closed Friday
afternoon at $18.90, down 24 cents.
Asset's rising fortunes reflect those of the booming debt-buying
industry, as growing numbers of creditors -- from credit-card issuers
to phone companies to hospitals and gyms -- turn to selling their bad
debts as a source of revenue. In 1993, $660 million of charged-off
credit-card debt was sold, according to the Nilson Report, a trade
publication. Last year, the number reached $57.3 billion.
In the past two years, three debt buyers -- Portfolio Recovery
Associates Inc., Asta Funding Inc. and Asset -- have issued shares to
the public for the first time. Encore Capital Group Inc., a debt buyer
in which Wall Street veteran Nelson Peltz has a major stake, moved
from over-the-counter trading to the more prestigious Nasdaq Stock
Market last year. Encore's shares have soared to $18.52 as of Friday,
compared with 30 cents in the beginning of 2002.
Asset and other debt buyers say they frequently offer to resolve debts
for far less than what they are owed, benefiting consumers. Asset
further asserts that by buying old debt, it indirectly encourages new
lending and the lowering of borrowing costs. "We are the good guys,"
Mr. Reitzel says.
His company's new collectors go through four weeks of training that
drills them in federal debt-collection laws, and executives say their
employees are so sincere that some debtors send collectors gifts and
cards for Christmas. Some attorneys who have represented consumers
against Asset say the outside lawyers the company hires are generally
professional in their dealings.
Small Claims
But there is more to the story. According to some lawyers and
advocates for consumers, Asset uses the relaxed rules of small-claims
and municipal courts to file suits that contain little documentation
of the debts it seeks to collect. These courts typically allow for
quick judgments when legally unsophisticated defendants fail to
contest the suits, the critics say. Once it obtains judgments, Asset
can use the full weight of the legal system to enforce its victories,
primarily by seizing assets or garnishing wages.
When individuals fight back against the company in court, consumer
lawyers and advocates say, Asset often drops its suits, not wishing to
engage in expensive legal skirmishing. The upshot is that poorer and
less sophisticated debtors are more likely to face a judgment for
Asset, these lawyers and advocates say.
Asset counters that it tries to collect from all of its debtors before
going to court. The company denies that its methods are harder on
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MrPepper,
I don't receive the Wall Street Journal but I'll presume that this is a
real article. I'm struck by the first anecdote where a woman is successfully
sued for $9500 in Arizona small claims court. A quick check suggests that
Arizona caps small claims at $2500. Are you sure of your facts? I also
wondered about the 4 yr.statute of limitations but didn't research this.
Dave M.
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That sure added something to this discussion. At least we know you don't
go to a barber very often.
In article <jjaqn0l1qretdu0qf3dg4j0egcsi2p9asg@4ax.com>,
Joel M. Eichen <joeleichen@yahoo.com> wrote:
Credit Card debt is a huge problem. There is a very successful
company,NASDAQ listed, around 2,000 employees, and revenues of around
$800 million per year.
Its a huge number. They are the guys who dunn you.AND COLLECT!
No more free pizza!
Joel
On 25 Oct 2004 08:52:55 -0700, MrPepper11@go.com (MrPepper11) wrote:
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On Mon, 25 Oct 2004 12:12:39 -0700, Robert Morien
<PhD_failure@nousefulinfo.com> wrote:
That sure added something to this discussion. At least we know you don't
go to a barber very often.
Ho-ho ...... actually a good retort!
Joel
In article <jjaqn0l1qretdu0qf3dg4j0egcsi2p9asg@4ax.com>,
Joel M. Eichen <joeleichen@yahoo.com> wrote:
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MrPepper11@go.com (MrPepper11) wrote in message news:<57cfd534.0410250752.1c01d0fa@posting.google.com>...
"Asset's hard-hitting strategy of going after consumers in
small-claims courts has affected tens of thousands of people around
the country... When individuals fight back against the company in
court, consumer lawyers and advocates say, Asset often drops its
suits, not wishing to engage in expensive legal skirmishing."
WALL STREET JOURNAL / October 25, 2004
Once-Ignored Consumer Debts Are Focus of Booming Industry
Asset Acceptance, a New Type Of Collector, Hits Paydirt
Suing for Modest Sums
Some Fight Back -- and Win
This doesn't really seem like news. When I was practicing law back in
Missouri about 10 years ago there were a couple of lawyers in town who
did nothing but debt collection on small and medium size debts like
this.
Andy
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In article <57cfd534.0410250752.1c01d0fa@posting.google.com>,
MrPepper11@go.com (MrPepper11) wrote:
Asset says it goes to great lengths to keep track of and obey laws
that vary greatly from state to state. It also says it doesn't always
file suit in small-claims courts. In Michigan, for example, attorneys
are barred from appearing in small-claims court
This is also the law in California, IIRC. It should be the law
everywhere. Small claims courts should be reserved for individuals, not
attorneys.
This is not to say that creditors/collections agencies should be barred
from using small claims courts for appropriate cases. Just that they
shouldn't be allowed to send hired legal guns to represent the companies
against defendants without the means to gain such representation.
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In article <zhbfd.7404$5i5.1479@newsread2.news.atl.earthlink.net>, marte005@earthlink.net says...
MrPepper,
I don't receive the Wall Street Journal but I'll presume that this is a
real article.
It is. I just read the same article in the WSJ, earlier today.
I'm struck by the first anecdote where a woman is successfully
sued for $9500 in Arizona small claims court. A quick check suggests that
Arizona caps small claims at $2500. Are you sure of your facts?
The cap may not apply when it's a matter of recovering unpaid
debts...
I also
wondered about the 4 yr.statute of limitations but didn't research this.
Obviously the debt collection company wouldn't try to recover
a debt if the statute of limits had run out on it.
And even if they did, the courts should prevent it.
FW
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MrPepper11 wrote:
For six years, she heard nothing about her Discover debt. Then, in
2002, she was sued in small-claims court in Phoenix.
should have paid it instead of being a deadbeat.
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California limits to use of Small Claims Court to <I believe, 12 times
per year.
--
To reply via e-mail please delete 1 c from paccbell
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In article <zhbfd.7404$5i5.1479@newsread2.news.atl.earthlink.net>,
marte005@earthlink.net says...
MrPepper,
I don't receive the Wall Street Journal but I'll presume that this is
areal article.
It is. I just read the same article in the WSJ, earlier today.
The cap may not apply when it's a matter of recovering unpaid
debts...
Obviously the debt collection company wouldn't try to recover
a debt if the statute of limits had run out on it.
Statutes of limitations are often affirmative defenses which must be pleaded
by the defending party in order to be effective. Thus, if a person is sued
on a debt which has run out because of the statute of limitations, he must
assert it as a defense. If he does not and a judgment is obtained, the
judgment is just as good and just as collectible as if the limitations
period had not run before suit was brought.
Check your state's law to see how statutes of limitation apply. Or see a
lawyer.
And even if they did, the courts should prevent it.
Another wannabe lawyer flatulating.
FW
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SoCalMike <mikein562athotmail@hotmail.com> wrote in message news:<OGifd.7484$R05.6692@attbi_s53>...
MrPepper11 wrote:
should have paid it instead of being a deadbeat.
As she stated "It was either that or feed my kids."
She may have had no control over her divorce and thus may have been
put into a situation where she indeed needed the money more for support
of her family.
There are cases where a $500 cc debt balloons to $3000 or more
due to "late fees" and other misc. crap. Maybe you thinks that's
ok, but I don't.
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bicycle@charter.net (R.White) writes:
SoCalMike <mikein562athotmail@hotmail.com> wrote in message news:<OGifd.7484$R05.6692@attbi_s53>...
As she stated "It was either that or feed my kids."
Or the third option, "Contact the credit-card company,
explain the situation, and work something out."
Most card issuers will work with a consumer to figure out how
they can pay back their debt over time if they run into hard
times that they could not have anticipated. There are also
many non-profit credit counseling services which will help
consumers with a lot of debt to work out a payment plan.
Perhaps the individual we're talking about availed herself of
those services, although it didn't sound like it from the
article. All too many consumers *don't* try to work something
out to pay off their debt -- they just walk away from it and
hope it'll go away. As this article shows, that is less
likely to work than it has been in the past.
There are cases where a $500 cc debt balloons to $3000 or more
due to "late fees" and other misc. crap. Maybe you thinks that's
ok, but I don't.
I think it's OK for interest and late fees to be assessed on
a debt if they ar spelled out in the card agreement and the
consumer takes no steps to work with the card issuer to work
out a payment plan.
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On Tue, 26 Oct 2004 14:48:00 +0000 (UTC), jik@kamens.brookline.ma.us
(Jonathan Kamens) wrote:
bicycle@charter.net (R.White) writes:
Or the third option, "Contact the credit-card company,
explain the situation, and work something out."
ASSUMPTION:
The person has income to work out with!
NOT ALWAYS SO>
Joel
Most card issuers will work with a consumer to figure out how
they can pay back their debt over time if they run into hard
times that they could not have anticipated. There are also
many non-profit credit counseling services which will help
consumers with a lot of debt to work out a payment plan.
Perhaps the individual we're talking about availed herself of
those services, although it didn't sound like it from the
article. All too many consumers *don't* try to work something
out to pay off their debt -- they just walk away from it and
hope it'll go away. As this article shows, that is less
likely to work than it has been in the past.
I think it's OK for interest and late fees to be assessed on
a debt if they ar spelled out in the card agreement and the
consumer takes no steps to work with the card issuer to work
out a payment plan.
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Joel M. Eichen <joeleichen@yahoo.com> writes:
On Tue, 26 Oct 2004 14:48:00 +0000 (UTC), jik@kamens.brookline.ma.us
(Jonathan Kamens) wrote:
ASSUMPTION:
The person has income to work out with!
First of all, if someone says they had to choose between
paying a credit-card debt and feeding their children, then
they had money, no? If they had no money, then there was no
choice.
Second, the article clearly says that the woman we're
discussing has a job now, since her wages are being garnished
to pay the debt. So even if she didn't have a job and income
at the time, she could have made arrangements to pay the debt
when she *did* get a job, if she'd tried, which it appears she
didn't.
Third, if you have debt and you truly have no income and no
likelihood of income in the foreseeable future, then the
right thing to do is declare bankruptcy, not default on your
debt and hope it disappears.
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bearclaw@cruller.invalid wrote in message news:<bearclaw-DDA340.17265425102004@newsclstr01.news.prodigy.com>...
In article <57cfd534.0410250752.1c01d0fa@posting.google.com>,
MrPepper11@go.com (MrPepper11) wrote:
This is also the law in California, IIRC. It should be the law
everywhere. Small claims courts should be reserved for individuals, not
attorneys.
What if the individual is an attorney?
This is not to say that creditors/collections agencies should be barred
from using small claims courts for appropriate cases. Just that they
shouldn't be allowed to send hired legal guns to represent the companies
against defendants without the means to gain such representation.
Hired "legal guns" are probably too expensive anyway. I'm sure
these companies have already explored all the legal avenues and
just send someone to recite whatever legal formula they have
come up with for a particular type of case. Can't be too tough
if the person simply quit paying on a debt.
-Tom
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On 26 Oct 2004 09:48:26 -0700, baron48@hotmail.com (baron48) wrote:
bearclaw@cruller.invalid wrote in message news:<bearclaw-DDA340.17265425102004@newsclstr01.news.prodigy.com>...
What if the individual is an attorney?
Then he's got to go with the other sharks.
Hired "legal guns" are probably too expensive anyway. I'm sure
these companies have already explored all the legal avenues and
just send someone to recite whatever legal formula they have
come up with for a particular type of case. Can't be too tough
if the person simply quit paying on a debt.
-Tom
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On Tue, 26 Oct 2004 15:27:34 +0000 (UTC), jik@kamens.brookline.ma.us
(Jonathan Kamens) wrote:
Third, if you have debt and you truly have no income and no
likelihood of income in the foreseeable future, then the
right thing to do is declare bankruptcy, not default on your
debt and hope it disappears.
Either that to stake out the 7-Elevens in your neighborhood.
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SoCalMike <mikein562athotmail@hotmail.com> wrote
As she stated "It was either that or feed my kids."
Easy to claim.
Pity about the years since then too.
She may have had no control over her divorce and thus
may have been put into a situation where she indeed
needed the money more for support of her family.
And she may well have decided that she got away with not
paying what she owed, even when things have changed
again and she is capable of paying off the debt again.
There are cases where a $500 cc debt balloons to
$3000 or more due to "late fees" and other misc. crap.
Irrelevant when her's didnt.
Maybe you thinks that's ok, but I don't.
Your problem.
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In article <cllo30$jpf$1@jik.kamens.brookline.ma.us>,
jik@kamens.brookline.ma.us (Jonathan Kamens) wrote:
Or the third option, "Contact the credit-card company,
explain the situation, and work something out."
When we moved , our new phone # apparently recently belonged to a
dead-beat. One creditor called us with a recording that about once a
week left a threatening message to call them .
We finally had to , to stop their annoying messages. they said they
would stop, but they called again. We told them we are new users of that
# and they should cease & desist. they did.
Now we only occasionally get a call from another creditor agency. they
seem nicer.
I wonder how long the phone co. waited to give out this number?
I wasn't long enough for us.
Patriotism is supporting your country all
the time and the government when it deserves it.
-Mark Twain
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On Tue, 26 Oct 2004 11:37:38 -0700, veteran <georgew.k@humboldt1.com>
wrote:
In article <cllo30$jpf$1@jik.kamens.brookline.ma.us>,
jik@kamens.brookline.ma.us (Jonathan Kamens) wrote:
When we moved , our new phone # apparently recently belonged to a
dead-beat.
Ahhhh, likely sorry........
sorry ... HUMOR.
Joel
One creditor called us with a recording that about once a
week left a threatening message to call them .
We finally had to , to stop their annoying messages. they said they
would stop, but they called again. We told them we are new users of that
# and they should cease & desist. they did.
Now we only occasionally get a call from another creditor agency. they
seem nicer.
I wonder how long the phone co. waited to give out this number?
I wasn't long enough for us.
Patriotism is supporting your country all
the time and the government when it deserves it.
-Mark Twain
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As she stated "It was either that or feed my kids."
She may have had no control over her divorce and thus may have been
put into a situation where she indeed needed the money more for support
of her family.
There are cases where a $500 cc debt balloons to $3000 or more
due to "late fees" and other misc. crap. Maybe you thinks that's
ok, but I don't.
Good. Then don't borrow money under terms that you
know for certain, when push comes to shove, you will
willingly refuse to abide by.
If you don't like it, don't borrow it. Period. Problem
solved.
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In article <bearclaw-DDA340.17265425102004@newsclstr01.news.prodigy.com>,
bearclaw@cruller.invalid wrote:
MrPepper11@go.com (MrPepper11) wrote:
Asset says it goes to great lengths to keep track of and obey laws
that vary greatly from state to state. It also says it doesn't always
file suit in small-claims courts. In Michigan, for example, attorneys
are barred from appearing in small-claims court
This is also the law in California, IIRC. It should be the law
everywhere.
So if someone chooses to sue you in small claims court, you shouldn't be
allowed to hire an attorney? You have to defend yourself?
Small claims courts should be reserved for individuals, not
attorneys.
This is not to say that creditors/collections agencies should be barred
from using small claims courts for appropriate cases. Just that they
shouldn't be allowed to send hired legal guns to represent the companies
against defendants without the means to gain such representation.
I don't see what this solves. Under your proposal, the collection agency
sues these defendants in regular court, they can use the attorney, and
these "hired legal guns" still face off against defendants who don't have
the means to gain such representation. How does that protect the
defendants?
---------------------------------------------
David M. Nieporent nieporen@alumni.princeton.edu
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In article <bearclaw-DDA340.17265425102004@newsclstr01.news.prodigy.com>,
bearclaw@cruller.invalid wrote:
Asset says it goes to great lengths to keep track of and obey laws
that vary greatly from state to state. It also says it doesn't always
file suit in small-claims courts. In Michigan, for example, attorneys
are barred from appearing in small-claims court
So if someone chooses to sue you in small claims court, you shouldn't
be allowed to hire an attorney? You have to defend yourself?
Yep. It aint rocket science. No legal parasites need apply.
Small claims courts should be reserved for individuals, not attorneys.
This is not to say that creditors/collections agencies should be barred
from using small claims courts for appropriate cases. Just that they
shouldn't be allowed to send hired legal guns to represent the companies
against defendants without the means to gain such representation.
I don't see what this solves.
Your problem.
Under your proposal, the collection agency
sues these defendants in regular court,
Which they wont normally do, particularly when the chances
of getting much money from the defendant are slim, stupid.
they can use the attorney, and these "hired legal guns" still
face off against defendants who don't have the means to gain
such representation. How does that protect the defendants?
Even someone as stupid as you should be able to
grasp the advantage when it happens in a small
claims court where legal parasites arent allowed.
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Aside from a total limit on filings per year California Small XClaim
Courts limit a party to two cases of over $2500 within 12 months. This
applies statewide so filing one case in SF for that amount and another
in another county reaches the limit.
The limits were specifically placed so that Small Claims Court did
not become a de facto collection agency.
--
To reply via e-mail please delete 1 c from paccbell
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In article <dnieporent-66C507.22030426102004@individual.net>,
David Marc Nieporent <dnieporent@earthlink.net> wrote:
So if someone chooses to sue you in small claims court, you shouldn't
be allowed to hire an attorney? You have to defend yourself?
Or an unreimbursed representative familiar with the dispute.
I don't see what this solves. Under your proposal, the collection
agency sues these defendants in regular court, they can use the
attorney, and these "hired legal guns" still face off against
defendants who don't have the means to gain such representation.
This actually happened to me. After getting laid off, I had done all
the good faith stuff, called the creditors regularly, updated them on
my situation, paid what I could at least once a month and so on. They
promised they wouldn't sue. Then I got a summons.
I called the company (Household Finance, IIRC) and they told me the
appearance date and time. What the heck. I was unemployed (mostly), so
I went. What did I have to lose?
When I got there--all duded up in my scruffy jeans and sneakers--I
found the whole courtroom filled with perfectly groomed Brooks Brothers
and Armani suits, all neat and tidy with their briefcases all perfectly
positioned on their laps. They were *all*, without exception,
representing complainants. This was in regular civil court, not small
claims. I was the sole defendant present that day. It was really
shocking.
LSS, I won the protection of the court, who upon hearing *my* side of
the story, ordered the finance company to accept the minimum amount I
believed I could pay without difficulty every month--$15. The judge
said to me, "if you have any problems paying or they give you any grief
at all, come back here and see me."
I'd already lost my home and my car, but I walked out of the courtroom
feeling like a million bucks. It saved me from declaring bankruptcy,
and eventually I got another job (actually two, one of which was my own
business working for lawyers and collections agencies) and was able to
pay off all my debts. Interestingly, none of my other creditors sued.
Heh. I wish I remembered the name of that judge. I'd really like write
to thank him again and let him know how much good he did that day. I
never filed a proper response to the summons nor did any of the other
stuff lawyers get paid for (IOW, the Court was in no way compelled to
hear my challenge to the complaint), and I won anyway. I think others
could too. I believe (and I have lots of good reasons to believe) that
most debtors who default are honest people who have gotten trapped,
either through ignorance or random happenstance...and sometimes through
what I consider criminal predatory behavior of lenders. I think the law
should reflect this assumption. And I think it often does, when the
court is allowed to use its own good judgement. Or at least it used to
before bankruptcy "reform" (actually bankruptcy butchery, IMHO).
Chances are good that anyone who can't afford an attorney is likely
judgement proof, anyway. I don't know if that concept applies in small
claims court (didn't have much dealing with small claims when I worked
collections, although some of the suits that crossed my path actually
cost more to file than the amount owed--that always struck me as
wastefully idiotic, but maybe it was just malicious).
How does that protect the defendants?
Most of the complaints in the OP's post were immediately dismissed for
lack of documentation. Who would need a lawyer to ask for documentation?
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MrPepper11@go.com (MrPepper11) wrote:
Asset says it goes to great lengths to keep track of and obey laws
that vary greatly from state to state. It also says it doesn't always
file suit in small-claims courts. In Michigan, for example, attorneys
are barred from appearing in small-claims court
bearclaw@cruller.invalid wrote:
This is also the law in California, IIRC. It should be the law
everywhere.
David Marc Nieporent <dnieporent@earthlink.net> wrote:
So if someone chooses to sue you in small claims court, you shouldn't be
allowed to hire an attorney? You have to defend yourself?
Yep. Small claims court is for ordinary people, not for hired guns.
The only times an attorney can appear in small claims court in CA are:
1. If the attorney himself is a party to the suit.
2. If one party is a corporation, and *all* the officers of the
corporation are attornies. Then one of the officers can appear. Most
of the time, corps prefer to have a designated person (non-attorney)
appear for them rather than sending their CEO, COO, CFO etc.
Small claims courts should be reserved for individuals, not
attorneys.
This is not to say that creditors/collections agencies should be barred
from using small claims courts for appropriate cases. Just that they
shouldn't be allowed to send hired legal guns to represent the companies
against defendants without the means to gain such representation.
I don't see what this solves. Under your proposal, the collection agency
sues these defendants in regular court, they can use the attorney, and
these "hired legal guns" still face off against defendants who don't have
the means to gain such representation. How does that protect the
defendants?
There are a lot more formalities in regular court.
However, even in small claims court the defendant can use the
available defenses *if* he/she knows about them.
In the example quoted by the OP, all the woman had to do was show up
in court, say, "this debt is older than the Statute of Limitations",
and the collection agency wouldn't have gotten a cent.
At least, in most states the SoL is a lot less than the 7 years that
debt was. It's 4 years for written contracts in CA.
--
I pledge allegiance to the Constitution of the United States of America, and
to the republic which it established, one nation from many peoples, promising
liberty and justice for all.
Feel free to use the above variant pledge in your own postings.
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On Wed, 27 Oct 2004 03:38:26 GMT I used my godlike powers to observe
the following from bearclaw@cruller.invalid:
I'd already lost my home and my car, but I walked out of the courtroom
feeling like a million bucks.
It's good to see the good guys win once in a while. I can't say that
I've ever been involved in a court situation, from any angle, that
corruption didn't blatantly run rampant. It's especially prevalent in
a legal situation where police are involved. I've seen judges
completely ignore a defending attorney's evidence that disproves what
police are saying. They all take care of each other.
--
To each according to his needs.
From each according to his abilities.
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On Wed, 27 Oct 2004 04:30:17 +1000 I used my godlike powers to observe
the following from "Rod Speed" <rod_speed@yahoo.com>:
Easy to claim.
Pity about the years since then too.
And she may well have decided that she got away with not
paying what she owed, even when things have changed
again and she is capable of paying off the debt again.
Guilty until proven innocent, right?
There are cases where a $500 cc debt balloons to
$3000 or more due to "late fees" and other misc. crap.
Irrelevant when her's didnt.
Your problem.
You being a dickhead could be more of a problem.
--
To each according to his needs.
From each according to his abilities.
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jik@kamens.brookline.ma.us (Jonathan Kamens) wrote:
Or the third option, "Contact the credit-card company,
explain the situation, and work something out."
Joel M. Eichen <joeleichen@yahoo.com> wrote:
ASSUMPTION:
The person has income to work out with!
NOT ALWAYS SO>
1. No need to shout.
2. If they have no income and no assets, the collection company can
sue all it wants to. And win. And then the person files for
bankruptcy, and the collection company gets _zilch_ for the money and
effort they put into suing.
IOW, you can't get blood from a stone.
In fact, it sounds like the person cited in OP's article might have
done well to just go through BK, but if she had the ability to pay,
even though slowly, it's good that she is doing so.
We will all be better off if people who _can_ pay their debts, do so.
--
I pledge allegiance to the Constitution of the United States of America, and
to the republic which it established, one nation from many peoples, promising
liberty and justice for all.
Feel free to use the above variant pledge in your own postings.
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